Companies vie for HDTV customers

If high-definition is the new front in the battle for TV viewers, it appears that DirecTV is seizing the high ground — at least for now.

Fortified by new satellite capacity, DirecTV added 21 high-definition channels to its lineup last week, bringing its total to 30. It expects to double that by the end of October and offer up to 100 channels by year's end, although some of those will be pay-per-view, not new channels.

Although DirecTV appears to have the most ambitious plans, competitors aren't ceding territory without a fight. In November, SureWest Broadband plans to add 15 new high-definition channels to the 23 it already has. By the end of 2007, AT&T said it will graft five HD channels onto its current lineup of 27 and Comcast plans to add between four and eight, depending on the neighborhood.

More than price, more than features or fancy gadgetry, it's the basics — more HD programming — that TV carriers are counting on to entice subscribers.

"This is an arms race. It's the high-definition equivalent of Russia and the United States during the Cold War," said Phil Swann, a consultant and publisher of TVPredictions newsletter.

Analysts say companies like SureWest, AT&T and Comcast have to respond aggressively or risk losing the business of roughly 30 million households that already have high-definition TVs.

"The future of television is high-def," Swann said, "and for TV providers to remain strong, they need a lineup to appease that growing audience."

That's especially true with the approaching holiday season, when consumers will be snapping up new HD sets. "People will want HD programming, and if someone is not going to give it to them, it's not that hard to switch carriers," he said.

Satellite companies DirecTV and Dish Network have a bigger stake in offering more HD programming, said Jimmy Schaeffler, analyst for The Carmel Group.

Because the satellite carriers don't offer Internet, telephone service or video-on-demand as cable companies do, they need to attract customers with other goodies.

"When you are fighting the cable companies that have these bundles, you need a perceived advantage," Schaeffler said.

DirecTV is betting huge sums that customers will respond to its HD upgrade. The company said it has spent more than $1 billion in the past few years beefing up its satellite capabilities to carry more HD channels.